04 September 2012

Dish TV India - Leading by innovation; visit note; Buy:: Edelweiss, PDF link


Dish TV India (DITV IN, INR 66, Buy)
We recently met Mr. R. C. Venkateish, CEO, and Mr. Rajeev Dalmia, CFO, Dish TV. The company expects its innovative SD-DVR offering and aggressive advertising to address concerns of slowdown post the price hike on July 1. Subscriber additions in Q2FY13 so far have been in line with Q1FY13. Management expects FY13E exit ARPU to be in the INR162-165 range. With the government again remaining firm on Phase 1 deadline and 60% inter-connect agreements in place, we expect the digitisation process to speed up considerably over the coming two months. We continue to remain positive on Dish TV and expect it to be one of the major beneficiaries of the digitisation process. Maintain ‘BUY’.

Hike in petrol, diesel, LPG prices likely after Monsoon session:: HT

An increase in petrol, diesel, domestic cooking gas (LPG) and kerosene prices looks "imminent" after the finance ministry said it has no money to provide for fuel subsidy. "This (hike) is imminent. There is no question of holding back now," a top oil ministry official said on Tuesday.

In all possibility, prices may be increased after the current monsoon session of Parliament ends on Friday.
Diesel, domestic LPG and PDS kerosene rates have not been changed since June 2011 even though cost of production has soared 28%.
State-owned fuel retailers are losing Rs 560 crore per day on sale of diesel and cooking fuel, and are forced to resort to short-term borrowings to meet funds needed for importing crude oil (raw material).
Borrowings of the three fuel retailers have shot up to Rs 1,57,617 crore at end of June from Rs 1,28,272 crore as on March 31.
Besides, they are losing close to Rs 5 per litre on petrol, a fuel that was decontrolled in June 2010 but rates of which haven't moved in tandem with cost.
"Finance ministry says it is not left with funds to subsidise oil companies. Oil companies are jewels of India. They need to be saved at all cost. Governments come and go, but oil companies will be required to fuel the country," the official said.
Diesel is being sold at a loss of Rs 19.26 a litre, kerosene at Rs 34.34 per litre and domestic LPG at Rs 347 per 14.2-kg cylinder.
At current rate, the three firms are projected to lose Rs 1,92,951 crore in revenues in the financial year ending March 31, 2012.

Hike in petrol, diesel prices likely after Friday::ET

An increase in petrol, diesel, domestic cooking gas (LPG) and kerosene prices looks "imminent" after the Finance Ministry said it has no money to provide for fuel subsidy. "This (hike) is imminent. There is no question of holding back now," a top oil ministry official said today. In all possibility, prices may be increased after the current monsoon session of Parliament ends on Friday. Diesel, domestic LPG and PDS kerosene rates have not been changed since June 2011 even though cost of production has soared 28 per cent. State-owned fuel retailers are losing Rs 560 crore per day on sale of diesel and cooking fuel, and are forced to resort to short-term borrowings to meet funds needed for importing crude oil (raw material). Borrowings of the three fuel retailers have shot up to Rs 1,57,617 crore at end of June from Rs 1,28,272 crore as on March 31. Besides, they are losing close to Rs 5 per litre on petrol, a fuel that was decontrolled in June 2010 but rates of which haven't moved in tandem with cost. "Finance Ministry says it is not left with funds to subsidise oil companies. Oil companies are jewels of India. They need to be saved at all cost. Governments come and go, but oil companies will be required to fuel the country," the official said. Diesel is being sold at a loss of Rs 19.26 a litre, kerosene at Rs 34.34 per litre and domestic LPG at Rs 347 per 14.2-kg cylinder. At current rate, the three firms are projected to lose Rs 1,92,951 crore in revenues in the financial year ending March 31, 2012.

FII DERIVATIVES STATISTICS FOR 04-Sep-2012

FII DERIVATIVES STATISTICS FOR 04-Sep-2012 
 BUYSELLOPEN INTEREST AT THE END OF THE DAY 
 No. of contractsAmt in CroresNo. of contractsAmt in CroresNo. of contractsAmt in Crores 
INDEX FUTURES24017623.7037315941.163791619961.75-317.46
INDEX OPTIONS2654926962.352519316613.48143577237810.78348.87
STOCK FUTURES390581012.73538201419.6493207324180.03-406.91
STOCK OPTIONS23974642.9323187617.8134447937.1725.13
      Total-350.36


-- 

FII & DII trading activity across NSE and BSE 04-09-2012


 BuySellNet
ValueValueValue
FII1634.311329.9
304.41
DII702.67808.27
-105.6
 

KEC International - Changing course; time to BUY; visit note; upgrade to Buy :Edelweiss, PDF link


KEC International (KECI IN, INR 55, upgrade to Buy)
Our recent interaction with KEC International (KEC) management infuses us with optimism on the company’s overall profitability and growth potential of its various business segments. Balance sheet improvement post leveraged buyout of SAE Towers (US) and recent hike in promoter stake further cement our conviction on the stock. We upgrade our reco to ‘BUY’ and revise up our FY14E EPS 4% with a revised TP of INR77/share.

Auto Sales Update - Not so August ::Edelweiss, PDF link

August was another weak month for auto sales. Car, two wheeler, truck, and tractor sales stayed under pressure whereas UV and LCV posted positive growth. While weak monsoon dampened rural sentiments, high interest rates, high inflation, and slowing economy took a toll on urban demand. We prefer Bajaj Auto and Tata Motors for being export stories amidst the domestic slow down. 

How NCDs are different from FDs ::Business Line


NCDs may or may not be secured, while bank deposits are simply covered by deposit insurance to an extent.
Companies such as Shriram Transport Finance, Muthoot Finance, Manappuram Finance and Shriram City Union Finance came out with Non-Convertible Debenture (NCD) issues in the recent past. NCD offers from other firms such as India Infoline and Religare Finvest are also on the cards. What are these NCDs and how different are they from Fixed Deposits (FDs)?
To begin with, like FDs, infrastructure bonds and tax-free bonds, companies use NCDs as another route to raise capital. For investors like you and I, an NCD is therefore yet another investment option available on the debt side.

External Trade - Deficit widens on slowing exports ::Edelweiss, PDF link


Trade deficit widened sharply in July to ~USD15.5bn compared to an unusual low of ~USD10bn in June, largely due to a sharp fall in exports and rise in non-oil imports. Still, the trade deficit during Apr-Jul 2012 stood lower at ~USD55bn compared to USD61bn in the same period last year.  Slowing exports reflect a challenging external environment, and forward looking exports orders index (in the PMI data) suggests that this would continue. Imports which jumped up in July might not sustain the pace given the faltering domestic demand and slowing gold imports although a rebound in prices will keep oil imports sticky. On balance, trade deficit would remain wide in coming months (although lower than last year).




Regards,

Comfort Commotrade IPO opens tomorrow (Sept 5th)


Issue Terms
 
Issue price / Floor Price (Rs)
10
Application per share (Rs)
10.00
Minimum investment amount (Rs)
100,000.00
Minimum bid (no of shares)
10000 shares and in multiples of 10000 thereafter
Maximum Shares for Retail
20000
Issue Date and Size
 
Issue opens
05-Sep-12
Issue closes
10-Sep-12
Listing on
BSE SME
Issue size (Rs cr)
6


Shares on Offer
Lakhs
Total shares offered
60.00
Of above, offered to public
54.90
Post-issue shares
100.20


Lead Managers & Registrar
Lead Manager(1)
VC Corporate Advisors Pvt Ltd
E-mail
mail@vccorporate.com


Registrar
Sharepro Services India P Ltd
E-mail
sme.ipo@shareproservices.com
Company Contact Details
Company's address
A-301 Hetal Arch, S V Road Malad (West), Mumbai
Pincode
400 064
Tel No.
91 22 28449765
Fax No.
91 22 28892527
Website
http://www.comfortcommotrade.com



How to read an annual report ::Business Line


An annual report helps you understand both the company and its industry.
Annual reports are coming thick and fast these days, but do you think they are just tomes of endless prattle about sales and profits? Well, if this has made you push reading annual reports to the bottom of your to-do list, here are the areas to focus on.

Best Funds to Buy (as on Sep 02, 2012) Moneycontrol

Edelweiss Technical Reflection (ETR) -Sept 4 2012-EDEL


Edelweiss Technical Reflection (ETR)
    Markets set-off the new month on a lackluster note with the benchmark index moving in a tight range of 52 points and closing with a marginal loss of ~0.25%. The day began on an optimistic note and it seemed that 5300 and higher was in reach, however, the on-going skepticism and uncertainty led to selling, pulling it back down to sub 5250 levels. Participation was low, and the market breadth was mildly in favor of advances. Immediate near-term momentum indicators are pointing to an oversold condition, hence on test of key supports can lead to a rebound rally. Short-term trend however remains down as long as Nifty trades below its 20 and 50 day EMAs and the momentum oscillators trade with sell signals. Nifty is poised to close the 'bullish gap' of 6th Aug at 5220 and possibly drop down to key support of 5200 and then lead to a rebound rally upto 5300.
    Trend among the sectoral indices was mixed on a lackluster day like yesterday. The top gaining indices were Cap Goods (+0.63%) and Autos (+0.40%); and on the losing side were Realty (-0.86%), Oil & Gas (-0.80%) and Banking (-0.65%). Broader markets once again managed to outperform the frontline benchmark with marginal gains of 0.09% for the Mid-cap index and 0.03% for the Small-cap index.
    Bullish Setups: INFO, TCS, RIL, BIOS, APNT, GDSP,
    Bearish Setups: CNXBANK, LT, HNDL, ONGC, IDFC, HDFCB

Stocks in News -Sept 4 2012-EDEL


Stocks in News
    Telecom panel to decide new norms for 2G permits on Friday (ET)
    Saddled with bad loans, banks seek to remove clutch of cos from CDR (ET)
    Finmin wants PSUs to give 5% of divested shares to employees (ET)
    SC allows 18 Ore mines in Karnataka to resume Ops (ET)
    Only ‘non-serious’ players to lose Coal Block Permits; IMG to seek investment details from 58 operators (ET)
    TechM set to buy out India BPO of Hutch; $100-million deal expected to be announced today (ET)
    Cos told to submit safety reports of New Drugs every 6 months (ET)
    ‘PMO asked Coalmin to De-allocate no-performing Blocks in Nov 2011’ (ET)
    R-power begins output at Two Sasan Coal mines (ET)
    Allahabad bank to offer 2% rebate on Home loan (ET)
    CCI can slap fine on cos involved in Cartelisation (ET)
    Diesel prices may rise by INR4-5/ litre after September 7 (ET)
    Piramal eyes Ind-swift facilities in INR10-bn deal (BS)
    Sundaram finance to enter the UK (BS)
    Strides Arcolab gets nod for cancer drug (BS)
    Wockhardt gets USFDA nod for depression drug (BS)
    L&T arm bags INR 10.63-bn order (BS)
    India to sell bonds worth INR 160-bn (MINT)

Sales Traders Commentary -Sept 4 2012-EDEL


Sales Traders Commentary
    The Indian market ended marginally lower on Monday led by realty, oil & gas, metal, and banking stocks. Disruption of Parliament session for ninth consecutive day, along with weak manufacturing data with numbers at nine-month low underpinned bearish sentiments. European markets had opened weak, but recovered later on hopes of easing interest rates after release of weak China data.
    The Sensex closed at 17384, down 45 points, while the Nifty slipped 05 points to end the day at 5254.
    Major gainers were Bajaj Auto (3.04%), Coal India (2.18%), Maruti Suzuki India (1.79%), Cipla (1.79%), Bharat Heavy Electricals (0.98%), and Larsen & Toubro (0.88%).
    Major losers were Jindal Steel & Power (2.23%), Tata Power Company (1.91%), Tata Motors (1.24%), Tata Steel (1.23%), Oil & Natural Gas Corporation (1.20%), and Mahindra & Mahindra (1.03%).
    The Realty index was down 0.86%. Major losers were DB Realty (3.2%), Indiabulls Real Estate (2.77%), Anant Raj Industries (2.11%), Godrej Properties (1.17%), and DLF (0.64%).
    The Oil & Gas index slipped 0.8%. Major losers were Hindustan Petroleum Corporation (1.87%), Gujarat State Petronet (1.39%), Indian Oil Corporation (0.61%), GAIL  (India) (0.54%), and Oil India (0.38%).
    The Bankex was down 0.65%. Major losers were H D F C Bank (0.82%), Bank of Baroda (0.7%), ICICI Bank (0.64%), Bank of India (0.52%), and IndusInd Bank (0.08%).
    Major gainers in the mid–cap space were A I A Engineering (2.57%), CORE Education and Technologies (1.1%), A B G Shipyard (0.43%), Amara Raja Batteries (0.2%), and Alstom India (0.15%).

    Major gainers among small caps were Advanta India (10.08%), Aarti Industries (4.92%), A2Z Maintenance & Engineering Services (2.06%), Aanjaneya Lifecare (0.98%), and Aegis Logistics (0.55%).
    Globally, Asia ended on a mixed note while Europe indices were trading higher.

JSW Steel - JSW Ispat Merger -Target Price: Rs732 :Centrum


JSW Steel - JSW Ispat Merger
Neutral
Target Price: Rs732
CMP: Rs694
Upside: 5.5%
Aggressive move in an adverse environment, downgrade to Neutral as valuations set to suffer
JSW Steel has announced the merger of its associate JSW Ispat with itself at a share swap ratio of 1:72 resulting in an equity dilution of 8.3% and creating the largest steel company in India by capacity (14.3 mtpa). We see the merger as impacting negatively on the merged entity in the short term on account of lower margin profile of the merged entity (drop of 160bps in FY14E), high debt levels (to increase by ~Rs78bn in FY14E) putting a strain on balance sheet, no immediate further equity infusion from JFE steel and absence of operational raw material assets in the portfolio. For FY14E, we see proforma EPS for the merged entity reducing 17.5% despite increase in EBITDA by 15.6% on account of lower margin, higher interest costs and equity dilution. We downgrade the stock to neutral from Buy with a target price of Rs732.

Nestle - Filling capacity to the brim; visit note; Hold ::Edelweiss, PDF link


Nestle (NEST IN, INR 4,635, Hold)
We recently met Nestle management. Volume growth which has been lower than expectation in the past few quarters remains challenging due to discretionary slowdown in foods and high competitive intensity in Coffee, Chocolates and Noodles. On the positive side, the company’s capacity is now largely in place to meet any demand. Also roping in Amitabh Bachchan for its brand Maggi has aided a revival in the brand’s volume growth. Few innovations like Milkmaid Creations Kulfi have done exceptionally well. However, raw material pressure remains high. We expect a pick-up in the new product pipeline aided by the likely commencement of its R&D center and backed by aggressive ad spends (new focus on digital and regional media) that might help reverse the slowdown in sales. Maintain ‘HOLD’. 

4 Sept: Morning News (click on link to read article) IFCI Financial Services Limited


Morning News (click on link to read article)
Economic Times

Business Standard

Business Line

Mint

Financial Express

Financial Chronicle

(Click on link to view article)
Thanks and Regards
IFIN: IFCI Financial Services Limited